The Technology of Transactions on the Blockchain

Virtual currencies, like Bitcoin and Ethereum are the first-use cases of the blockchain technology. The blockchain, as a data container, is used as an append-only data structure which means that transactions and data can be added onto the blockchain but the data cannot be erased. This makes the blockchain a permanent record of data.

See the blockchain as the following example: an office with computers which are only connected to each other, no internet. The blockchain has nodes which are connected to each other and keep information. In other words, the nodes are a network. The blockchain is much bigger, and it has nodes on all the computers in the world. This makes it transparent - everybody can see the information which is published on the blockchain. It is tamper-free because there are so many nodes that it is imposible for anyone to change the information. This excludes a middleman like a bank, so you can do business directly with each other. This transcations take place immediately at no extra cost.

A reward system are required to maintain the functionality of the blockchain. For example with Bitcoin you have miners and they recieve rewards when solving complex mathematical puzzles. In this case, the miners are rewarded with bitcoin currencies. They receive a small part of a one bitcoin. Once the transactions are verified and accepted as true by the entire network, the miners start working on the next block which is connected to the next block, a chain of blocks (blockchain). This blockchain keeps growing and will exist “forever”.

The blockchain technology is still in an early stage and cryptocurrencies are only its first major use case. The blockchain will change how we transact and record transactions. The best way to invest now in the blockchain is through knowledge. Learn as much as you can, because it is growing like the internet and with the blockchain, we will see a lot of new-use cases across all industries.

 

05 Comments
Emilly Blunt

December 4, 2017 at 3:12 pm

Never say goodbye till the end comes!

Emilly Blunt

December 4, 2017 at 3:12 pm

Never say goodbye till the end comes!

Emilly Blunt

December 4, 2017 at 3:12 pm

Never say goodbye till the end comes!

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